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The National Interest
Entrepreneurs Sans Frontieres
Tatiana Serafin
Abstract
06.01.2006
Billionaire Calvin Ayre has a $3.5 million, 10,000-square-foot compound in Costa Rica, does business with 16 million customers--mostly in the United States--and is a native Canadian holding the country's passport. He has no allegiance but to his own cause--online gambling. He pays no taxes to the United States or to Canada. He is persona non grata in the United States, is on shaky ground in Canada (which has similar restrictions against online gambling) and was recently raided by Costa Rican authorities, though not charged.
This is the new face of today's international businessman who may hold a passport or two from one country, reside in another and do business in yet another. That leaves loyalties up for grabs, if they exist at all. The name of the game is self-interest, not national interest, and a stateless ego may do more to shake-up the dusty premise of the nation-state than any supranational movement to date.
Businesses have long taken advantage of loopholes in tax laws, favorable registration locales and amenable politicians. The rise of offshore entities in the 1970s was one big step towards separating businesses from national ties. A 2004 report by the Center for Public Integrity uncovered at least 882 oil and gas subsidiaries based in tax havens like the Cayman Islands and Bermuda; in its pre-bankruptcy days, Enron incorporated 780 such vehicles to mitigate taxes and stand above the law, as the prosecution is trying to detail in the current trial of former chiefs Kenneth Lay and Jeffrey Skilling.